Ninth Fiscal Period Financial Results(ended May 31, 2011)

Contents
Highlights of the Ninth Fiscal Period

Fund Management Results

 Ninth Fiscal Period Financial Statement Overview

2

 Changes in Asset Size

21

 TOPICS Replacement Strategy

3

 Portfolio Occupancy Rate

22

 TOPICS Property Management and Finance4 Changes in Revenue (1)23 TOPICS Response to the Great Eastern Japan Earthquake 5

 Changes in Revenue (2)24 TOPICS NRF’s Response to the Earthquake

 Engage in Asset Management25

 Management Results

26

 Financial Status (Ninth Fiscal Period End)27

 Appraisal Value Status (Ninth Fiscal Period End)28

 Unitholders (Ninth Fiscal Period End)29

 Changes in Investment Unit Price and Cash Distribution

30

6Fund Management Summary Current Status and Outlook of Rental Housing Market

8

 NRF Portfolio: Selective Investment of “Core Units”

9 Tenth Fiscal Period Management Policy

10 Tenth Fiscal Period Acquisition Policy

11 Current J-REIT Market

12 Management Strategies

13

 NRF Growth and Forecasts

14

Overview of the Financial Results

APPENDIX
 Changes in Financial Performance32

 Interest-bearing Debts (Ninth Fiscal Period End)33

 Portfolio Status

34
35

 Ninth Fiscal period Performance Overview

16 Portfolio Map (143 Properties)

 Income Statement17 Portfolio

 Balance Sheet

18

 Fund Profile40

 Forecasts for the Tenth Fiscal Period

19 Asset Management Company Overview

41

36-39

Highlights of the Ninth Fiscal Period1Ninth Fiscal Period (ended May 31, 2011) Financial Statement Overview
Financial Statement Overview[Difference in Forecasts and Results]

8th Fiscal Period

9th Fiscal Period(ended Nov. 2010)(ended May 2011)

Difference(previous period)

9th FP Forecast(released Jan. 2011)

Difference(from forecast)

Operating Revenues¥4,466 million¥4,510 million+ 1.0 %

¥4,479 million+ 0.7 %

Operating Income¥2,150 million¥2,177 million+ 1.2 %

¥2,130 million+ 2.2 %Net Income¥1,514 million¥1,465 million- 3.3 %

¥1,501 million- 2.4 %

¥12,068¥11,674- 3.3 %

¥11,960- 2.4 %Cash Distribution Per Unit

Difference in Cash Distribution (8th Fiscal Period and 9th Fiscal Period)(yen/unit) Property Replacement
Curtail Expenses+ 3.4 %

 Extraordinary Losses- 5.8 %

13,000[10th Fiscal Period Forecast]+ 333 yen

- 33 yen- 694 yen

12,068 yen
12,000- 394 yen

11,674 yen (- 3.3%)

11,000- Property
Replacement+ ¥51- HigherCommission Fee- ¥172- Key Money+ ¥211- Decrease inManagement Fee+ ¥22- Incidental
Revenue, etc.
+ ¥71

- Earthquake
Expense- ¥694- Decrease in
Loan-related Fee+ ¥117

Revenues

Expenses

Difference(this period)¥4,418 million- 2.1 %

¥2,122 million- 2.5 %

¥1,477 million+ 0.8 %

¥11,770+ 0.8 %

 Lower revenue due to seasonal factors

10,0008th FP
Cash Distribution

10th FP Forecast(released Jul. 2011)

Quake-relatedExpenses

9th FP
Cash Distribution

 No extraordinary loss

2

TOPICS

Replacement Strategy

Implementation of Replacement Strategy (from 9th FP)
Acquisition :High Yield
Low Building Age

Disposition :Low Yield
High Building Age

PRIME URBAN Ebisu Minami

URBAN STAGE Kamimaezu- Disposition Price : ¥975 million- Acquisition Price : ¥1,250 million- NOI Yield: 6.8% *1- Building Age: 2.9 years *2- Acquisition Date

: Jul. 5, 2011

- Book Value: ¥934 million- NOI Yield: 4.5% *3- Building Age: 9.1 years *4- Disposition Date : Mar. 22, 2011

URBAN STAGE Yono Hommachi

URBAN STAGE Kasai East

- Disposition Price : ¥526 million- Acquisition Price : ¥940 million- NOI Yield: 6.3% *1- Building Age: 4.9 years *2- Acquisition Date

: Jan. 12, 2011

PORTFOLIO- Book Value: ¥519 million- NOI Yield: 5.4% *3- Building Age: 20.6 years *4

144 properties¥134.1 billion(as of Jul. 20, 2011)- Disposition Date : May 31, 2011
*1 NOI Yield at time of acquisition is stated.
*2 Building Age at time of acquisition is stated.

*3 Yield, based on the fiscal period NOI at time of disposition, is stated.
*4 Building Age at time of disposition is stated.

Results of Replacement Strategy
Acquisition

No. of Properties
Property Price
Average NOI
Average Building Age

4 Properties
4.2 Billion Yen
6.5 %3.5 Years

Disposition

3 Properties
1.6 Billion Yen
4.8 %13.8 Years

Replacement
Effectiveness1 Property
2.6 Billion Yen
Enhance NOI
and Building AgeExternal GrowthWith Improved
Quality of Portfolio
3

TOPICS

Property Management and Finance (Ninth Fiscal Period)

Property Management

Finance Keep High Occupancy Rates After Turnover Season

 Issuance of Investment Corporation Bond

Portfolio Occupancy Rate : 96.3 %(8th FP)→

96.1 %(9th FP) Enhance Market Competitiveness Through Renovations
US Karasuyama: Common Area Renovation

US Asakusa: Entrance Hall Renovation

AmountTerm
Interest Rate
Ratings: ¥5 billion: 5 years: 1.21% (L+38bps): AA (JCR), A (S&P)

Use of Proceeds: Elongation and fixation of loan terms

 Financial Figures at 8th Fiscal Period End
Difference from previous period

 Seek Internal Growth Opportunities

Interest-bearing Debt Total: ¥74,606 million (- ¥70 million)

Increase in Profit: Antennae Installation, etc.

LTV

: 53.1%(+ 0.0pt)

Curtail Expenses: Curtail Building Management Expenses

Fixed Ratio: 74.8%(+ 0.0pt)

Long-term Debt Ratio: 46.1%(- 27.1pt)<Changes in Average Portfolio Occupancy Rate>

(%)
(％)

<Status of Maturity Diversification>(Millions of Yen)

100

30,000

96.3%

95.9%

95.8%

96.5%
95.6%

95.9%

96.1%

95

25,23425,000Elongation and Fixation through Bond Issuance

20,00014,98015,00090

10,000
6,610

5,070

7,190

6,362

5,090

4,090

5,000

2,390

85

90

0

11月
Nov.

12月
Dec.

1月
Jan.

2月
Feb.

3月
Mar.

4月
Apr.

5月
May

9 th
第9期
FP

1,130

90

1,350

10th 第11期
11th
12th 第13期
13th
14th 第15期
15th 第16期
16th 第17期
17th 第18期
18th 第19期
19th 第20期
20th 第21期
21th
第10期
第12期
第14期
FP

FP

FP

FP

FP

FP

FP

FP

FP

FP

FP

FP

4

TOPICS

Response to the Great Eastern Japan Earthquake

Response After Earthquake
Confirm Status of Damage

Conduct Sequential Repair Work
March 14

March 11

Primary Confirmation
Earthquake

Confirmation by third-party *and receive estimate for repairs

Secondary Confirmation

Primary Confirmation- Request to property
management company
for confirmation

May 20March 17

- Confirm there were no serious
damages (human injuries,
collapse of buildings, etc.)

Secondary Confirmation

Final Confirmation- Confirm property damage(property management company
and NREAM engineer)- Confirm there are no problems regarding
structure or usage- Receive final estimate for repair work
*Conducted on the 5 properties in Sendai.

Status of Damage After Earthquake [Total: 28 properties Repair Fees ¥87 million]
Sendai (5 properties)

PRIME URBAN
Nagamachi Icchome(chipped wall in common area )Greater Tokyo Area (23 properties)

PRIME URBAN
Yaotome Chuo(exterior damage)

URBAN STAGE
Nihonbashi Yokoyamacho(damage to expansion joint covers)

PROUD FLAT
Asakusa Komagata(exterior tile detachment)

Full amount will be allocated in the 9th FP → Eliminate the impact on following FP
5

TOPICS

NRF’s Response to the Earthquake

NRF Portfolio Diversification
Sapporo: 11 properties (3.8%)

Portfolio PML

All Properties

5.30 %New Earthquake
Resistance Standard(Reference) New Earthquake Resistance Standard

Osaka: 3 properties (2.3%)
Sendai: 5 properties (2.9%)

Fukuoka: 5 properties (2.１%)

Type

ShindoLarge-scale
Earthquake(very rare)

7

Earthquake Resistance Standard

Buildings will not collapse or endanger lives
Strong 6

Weak 6

Greater Tokyo Area:

116 properties (87.0%)

Mid-scale
Earthquake

Strong 5

Buildings remain functional

Weak 5

Nagoya: 3 properties (1.9%)* The ratio to total acquisition price is stated within the brackets.

Small-scale
Earthquake

4

3

Nano-scale
Earthquake

2

Buildings havenearly no damages

1*Earthquake Insurance Coverage BasisTaking into consideration the effects implicated to the total portfolio in case of an earthquake, when the portfolio PML is over
15%, all properties with PML over 15% will be covered with earthquake insurance.
6Fund Management Summary7

Current Status and Outlook of Rental Housing Market
Changes in Number of Households (“Total ””Singles””DINKs”) [Greater Tokyo Area](%)

Changes in Total Number of Households and Singles/DINKs Households(Thousand Households)

16,000200
14,91815,253

15,414

15,415

180

13,157• Over 50% of the household ratio after 2005 aresingles and DINKs households

Total
140
Number ofHouseholds(124%) 120

Over 50% of the total
number of households

12,318• Single and DINKs households will continue to increase

Singles/
DINKs 160
(158%)

13,757

14,000• Households due to start decline in 2025

15,268Peak of Numberof Households

12,000

Small households, such as singles/DINKs,
will continue to steadily increase.

100
80

10,000
1995

2000

2005

2010

2015

2025

2020

2030

Source: National Institute of Population and Social Security Research

Changes in Number of Net Inflow and Rental Housing Under Construction [23 Wards of Tokyo]
Number of rental housing under construction from Jan-May 2011

(unit/person)

Number of Building Starts

70,00059,49660,16349,04540,000• Continuous gap between potential demand and supply

59,06960,000(units)52,94950,61250,000Net Incomings

49,06943,4282,000

Gap in Demand

Earthquake

37,36643,371

32,92539,08430,00020,00030,76525,603

1,859

38,567

23,831

33,101

31,880

1,750

1,705

Continues

26,512

25,88821,718Decrease inamount of construction

1,575
1,492

1,500

17,05410,0001,350

Less Supply

0

Half the amount of 2009

1,250

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Jan
2011

Feb

Mar

Apr

May

Source: Ministry of Land, Infrastructure, Transport and Tourism, Policy Bureau, Information Security, Research and Statistics DivisionTokyo Metropolitan Government Bureau of General Affairs

8

NRF Portfolio: Selective Investment of “Core Units”
Core Units(rent ¥150,000 or less, floor area under 50 sqm)

Target Tenant Class with Strong Demands
and Stable Rent Potential
NRF Rent Distribution(units)3,500

At 9th Fiscal Period End: Most Distributed

Small Area

3,000Core Units¥150,000or less
92.7%

2,500
2,000

89.0

3,820 units
1,543
戸
1,543
1,636 戸1,500%
Unit Ratio :(Occupancy Rate: 93.6%)

Characteristics:
Single/DINKs units in Greater Tokyo Area

Characteristics:
Expensive units in Central Tokyo

Units with rent ¥150,000 or lessand floor area under 50 sqm

1,269
1,239 戸
974
945 戸

1,000

3.8

Unit Ratio :%(Occupancy Rate: 96.3%)¥150,000
50 sq. meters

Low
Rent

500

High
Rent

* ¥200,000 or more
Approx. 1.1%0

4.0～¥60,000～¥80,000～¥100,000～¥120,000～¥140,000～¥160,000～¥180,000～¥200,000¥210,000～～¥70,000～¥90,000～¥110,000～¥130,000～¥150,000～¥170,000～¥190,000～¥210,000(units)

NRF Floor Area Distribution

3,500
3,000
2,500

3.2

Unit Ratio :%(Occupancy Rate: 98.7%)

Unit Ratio :%(Occupancy Rate: 93.5%)

Characteristics:
Family units in Major Regional Cities

Characteristics:
Family units in Central Tokyo/Suburbs: Most Distributed

Large Area

3,219
3,211 戸Less than
50 sqm
92.8%

5,652
units

(%) Changes in Occupancy Rate of Core Units
100%

2,000

96.9%

1,500

1,330
1,268 戸1,103
1,173 戸

1,000

95%

96.2%

96.4%

96.4%

95.8%

96.5%

96.3%

94.4%
93.6%

Average 95.7%

500
90%

0
-15sqm20-25sqm
30-35sqm
40-45sqm
50-55sqm
60-65sqm
70-75sqm
80-85sqm
90sqm15-20sqm
25-30sqm
35-40sqm
45-50sqm
55-60sqm
65-70sqm
75-80sqm
85-90sqm

85%*Units : 7,563 units (only residential units) (as of 9th FP End)

1st FP End
2nd FP End
3rd FP End
4th FP End
5th FP End
6th FP End
7th FP End
8th FP End
9th FP End(May 31, 2007) (Nov. 30, 2007) (May 31, 2008) (Nov. 30, 2008) (May 31, 2009) (Nov. 30, 2009) (May 31, 2010) (Nov. 30, 2010) (May 31, 2011)9

Tenth Fiscal Period Management Policy
Tenth Fiscal Period Management Policy
 Maintain the High Occupancy Rate Improve Leasing Conditions• Implement effective renovations• Aiming for increase of rent

Leased Units/Occupancy Rate Comparison to Previous Year
(Occupancy Rate)

Leased Units (Previous Year)

Leased Units

100%

Portfolio Occupancy Rate (Previous Year)95.8 %

95.6 %

92.1%

92.5%

96.5 %

95.9 %

94.9%

94.4%

95%
92.1%

(Number of Units)

600

9th FP (average)
96.0%
95.9 %

Portfolio Occupancy Rate

96.1 %
95.2%

500

7th FP (average)
93.5%

90%

400

March 11
Great Eastern Japan Earthquake* Demand in turnover in late March wasdelayed to early May.
 As the occupancy rate was higher
compared to the previous year, the total
number of leased units has decreased.

Decline in number of leases*

85%

300
Delay in demand due to earthquake
Increase in number of leases*

80%

200

 Total Number of Leased Units
9th Fiscal Period ： 1,165 units

9期

75%

7期

100

7th Fiscal Period ： 1,302 units(same period previous year)

70%

0
DecemberJanuary

February

March

April

May
* Comparison to Previous Year

10

Tenth Fiscal Period Acquisition Policy
Tenth Fiscal Period Acquisition Policy Selective Investment of High Yield Properties

 Utilizing Various Pipelines• Discover prime properties, assess location and merchantability• Maximize networking ability

Lending Attitude of Financial Institution

J-REIT Asset Transaction Trend(Diffusion Index of Real Estate/All Enterprises)

Recovering after stagnant period directly after the earthquake.

Lending attitude of financial institutions have eased since 2009, andhave continued after the 3.11 earthquake.

(millions （百万円）
of yen)125,000

0

Transaction Increase-5

100,000-10

March 11, 2011
Great Eastern Japan
Earthquake

75,000-15-20

Recovery ofTransaction

50,000Recovery Trend

-25

売買停滞

25,000-30-35

0Mar. 2008

Sep. 2008

Mar. 2009

Sep. 2009

Mar. 2010

Sep. 2010

Mar. 2011

平成20年3月 平成20年9月 平成21年3月 平成21年9月 平成22年3月 平成22年9月 平成23年3月
Jun. 2008

Dec. 2008

Jun. 2009

Dec. 2009

Jun. 2010

Dec. 2010

Jun. 2011

1st
half
1月上旬

2nd
half
1月下旬

January

1st
half
2月上旬

2nd
half
2月下旬

February

1st
half
3月上旬

2nd
half
3月下旬

March

1st
half
4月上旬

2nd
half
4月下旬
April

1st
half
5月上旬

2nd
half
5月下旬
May

* Based on the total amount of the properties acquired and disposed by each J-REIT from 2011.

Results of NRF

Changes in Capitalization Rate(%)

Number of information on properties fall but the number of potential
properties on the rise.

Capitalization Rate declining since April 2010.

6.5
6.0

5.8%

5.5
5.0

5.9%

5.8%

5.6%

5.6%

5.2%
4.7%

8th FP

9th FP

Difference

Number of Information

340

222

－118

Potential Properties

54

62

＋

8

Downward Trend

4.5
Apr.
2008
平成20年4月

Oct. 2008
平成20年10月

Apr. 2009平成21年4月

Oct. 2009平成21年10月

Apr. 2010平成22年4月

Oct. 2010平成22年10月

Apr. 2011平成23年4月

Source: (Upper Left) Based on the data disclosed on listed REIT’s website(Lower Left) Japan Real Estate Institute, Research and Study Department

11

Current J-REIT Market
Trading Volume by Investor Type (Dec. 1, 2010-May 31, 2011)
200,000

Sell
売り

Buy
買い

Difference
差引2011
Jan. 31

Feb. 28

Mar. 31

Apr. 30

May 31

Total Trade Amount

0.4 trillion

0.4 trillion

0.2 trillion

0.3 trillion

0.2 trillion

0.2 trillion

J-REIT Market Cap

3.7 trillion

3.6 trillion

3.6 trillion

3.5 trillion

3.6 trillion

3.5 trillion（
売買代金 百/万円）

Buying increase fromfinancial institutions

Continued inflow into investment trusts

100,000

30,00020,00010,00050,00000-50,000-10,000-100,000-150,000-200,000

Self-dealings
自己取引

Individuals
個人

Foreigners
外国人

12月 01月 02月 03月 04月 05月

12月 01月 02月 03月 04月 05月

12月 01月 02月 03月 04月 05月

投資信託
Investment
Trusts

事業法人+
Corporations, etc.
その他事業法人

Life/Non-life
Insurance
生保・損保

12月 01月 02月 03月 04月 05月

12月 01月 02月 03月 04月 05月

12月 01月 02月 03月 04月 05月

Banks
Other
Financial
銀行+
Institutions
その他金融機関12月 01月 02月 03月 04月 05月（
売買代金差引き 百/万円）

150,000

2010
Dec. 31-20,000-30,000

Changes in NRF Investment Unit Price
TSE
REIT Index
東証REIT指数

NRF Unit Price
NRF投資口価格

BOJ’s Amount of Purchase

(%)

(yen)

150

Automatic
Recovery
自律回復

481,809円¥481,809

BOJ Purchase
日銀買入

140
130

NRF Weighted Average
Investment Unit Price（VWAP)

464,105円¥464,105

440,953円¥440,953

BOJ Purchase
日銀買入475,306円¥475,306

Overview: BOJ’s J-REIT Purchase(As of May 31, 2011)

435,245円¥435,245

411,589円¥411,589

Purchase Total

Great Eastern Japan Earthquake
BOJ Announces
Purchase Increase

120
110
100

BOJ Support Buying(Post Earthquake ¥11.5 billion)

90

132億円
¥13.2
billion¥2.2
billion
22億円¥2.4
billion
24億円

10/12/01 December
10/12/15 10/12/30

2011
January
11/01/18:

Approx. ¥100 billion(¥80.3 billion remaining)

480,000
420,000

Purchase Period :Aim for end June 2012

Purchase Target :AA rating or more

360,000

Purchase Limits

Market Cap Ratio
Within 5% of Issued Units

300,000:

Remaining Purchasing Period
Approximately 1 Year

19億円
¥1.9
billion80

240,000
180,0002010
10/11/01 November
10/11/16
NRF Monthly Market Price

540,000¥482,785
482,785円¥50.4 billion¥59.37 billion¥59.88 billion

February
March
April
May
11/02/01 11/02/16
11/03/02 11/03/16
11/03/31 11/04/14
11/04/28 11/05/18¥59.12 billion¥58.24 billion¥62.13 billion¥58.31 billion* NRF unit price and TSE REIT Index as of Nov. 1, 2010 are stated as 100.

12

Each Strategy

MarketManagement Strategies

Internal Growth

External Growth

Financial & Capital Strategy

 Continued gap in rental leasing demandand supply Increase in REIT real estate transaction

 Lending attitude of financial institutions
easing Rental housing occupancy rates remainhigh Decrease in cap rate (transaction yield)

 Increase in Rent per Tsubo Acquire High Revenue Properties→ Increase lease terms→ Utilize both established andnew networks.

 Enhance/Maintain High
Occupancy Rates→ Understand tenant needs
Shorten leasing downtime→ Continue property turnover→ Build strong relations with lenders
Diversify ways of funding→ Active investor relations

 Deliberate Growth Through Equity
Finance→ Continue efforts without being
swayed by current market status

Towards Growth Diversification of Lenders Enhance Fund Recognition
 Improve Quality of Portfolio

 Attain Incidental Revenue/Curtail
Costs

Strengthen Profitability

 Public offering by numerous REITs

Increase Asset Size

Stable Financial Base

Enhance Cash Distribution

13

NRF Growth and Forecasts

Growth of Asset Size

Internal
GrowthRespond to Financial Crisis

Address
Earthquake

External Growth

（％）

104

102

High
Economic
Growth +1.8pt

Recovery Demand
Recovery of Real GDP
Real GDP
2006 Fiscal Year GDP Level100-1.5pt¥ 912千円
thousand-2.4pt98

96-2.0ptNRF’s Weighted
Fiscal Period Average
Investment Unit Price(VWAP)¥ 698千円
thousand

Sep. 2008
Lehman Brothers
Bankruptcy

94

Great Eastern Japan Earthquake
Slowing of Economic Growth-4.7ptBack on Track for Growth¥ 463千円
thousand(AssetSize)（資産規模）¥ 459千円
thousand

2,000¥ 367千円
thousand¥ 348千円
thousand¥ 381千円
thousand¥ 364千円
thousand2nd PO
1,500

Promote Property Replacement

1st PO1,103億円¥110.3billion1,000¥ 384千円
thousand

1,159億円¥115.9billion

1,215億円¥121.5billion

1,215億円¥121.5billion5th FP
第5期

6th FP
第6期

1,315億円¥131.5billion

1,334億円¥133.4billion

1,329億円¥132.9billion

7th
FP
第7期

8th FP
第8期

9th FP
第9期

IPO

670億円
¥67.0
billion

754億円
¥75.4
billion

500
1st
FP
第1期

2nd
FP
第2期

2007 Fiscal Year

3rd
FP
第3期

4th FP
第4期

2008 Fiscal Year2009 Fiscal Year2010 Fiscal Year

10th FP
第10期

2011 Fiscal Year

*Graph of real GDP of each year with 2006 fiscal year real GDP (approx. ¥552 trillion) stated as 100.
*The real GDP after 2010 fiscal year is the forecast figures based on the BOJ’s Outlook for Economic Activity and Prices data.

14

Overview of the Financial Results

15

Ninth Fiscal Period Performance Overview• Operating Revenue＋1.0%¥4.51 billion

Increase in key money and renewal fees

Allocation of real estate disposition revenues

Increase in brokerage fees and property management feesDecrease in asset management fees and trust fees

¥4.46 billion• Operating Income＋1.2%¥2.17 billion¥2.15 billion• Current Profits- 3.3%
 Allocation of earthquake expense¥1.51 billion¥1.46 billion• LTV±0.0pt

53.1%

53.1%

 Financial efficiency through property replacement

16

Income Statement

8th Fiscal period
From Jun. 1, 2010

Operating Revenue
Real Estate Rental Business Revenues*1

Rental Business Revenues
Other Rental Business Revenues
Parking Lot Revenue

9th Fiscal period

To Nov. 30, 2010

From Dec. 1, 2010
To May 31, 2011

Amount(￥000)

Amount(￥000)

Ratio
(%)

Ratio
(%)

 Maintain high occupancy rates
 Implement property replacement strategy
Disposition PU Ebisu Minami, US Yono Hommachi
Acquisition US Kasai East

4,466,436

100.0

4,510,792

100.0

4,461,932

99.9

4,497,365

99.7

4,170,077

93.4

4,171,787

92.5

291,8546.5

325,578

7.2

106,649

2.4

107,075

2.4

2.9

177,684

3.9* Reference (9th Fiscal Period)

Incidental Revenue*2

129,638

Other Real Estate Rental Revenue*3

55,566

1.2

40,818

0.9

4,503

0.1

13,4270.3

2,315,653

51.8

2,333,363

51.7

1,797,822

40.3

1,838,031

40.7

2. Incidental Revenue

149,965

3.4

153,601

3.4

Key Money:

0¥68,406 thousand

4.8

Renewal Fee:

0 0¥97,569 thousand

Real Estate Disposition Revenue
Operating Expense
Real Estate Rental Business Expenses
Repair Expenses
Tax and Public Dues

*4
*5

212,9194.8

215,350

Depreciation and Amortization

794,98417.8

793,296

17.6

Other Rental Business Expenses

639,952

14.3

675,782

15.0

Real Estate Disposition Profit and Loss

－

－

2,516

0.1

Asset Management Fees
Other Operating Expenses*6

Operating Income

322,4447.2

319,655

7.1

195,386

4.4

173,160

3.8

2,150,783

48.2

2,177,429

48.3

1. Real Estate Rental Business Profit and Loss : ¥2,659,334 thousand(Previous FP Comparison: - ¥4,776 thousand)3. Other Real Estate Rental Revenue
Revenue from cell phone antennae, vending machines, etc.
4. Renovation Expenses
Repair Expenses
Capital Expenditure::

Non-Operating Revenues

3,605

0.1

2,548

0.1

Non-Operating Expenses

638,470

14.3

626,301

13.9

Interest Expenses

601,223

13.5

586,338

13.0

－

－

15,8770.4

Subject Property:

37,2470.8

24,085

0.5

Excluded Property:

1,515,918

33.9

1,553,676

34.4

Investment Corporation Bond Interest
Other Non-Operating Expenses
Current Profits*7

5. Tax and Public Dues (145 properties at FP end)－－

87,117

1.9

6. Other Operating Expenses

33.9

1,466,558

32.5

983

0.0

1,029

0.0

Duty Entrustment Fee
Directors Fee

1,514,935

33.9

1,465,529

32.5

Retained Earnings Brought Forw ard

50

0.0

29

0.0

Retained Earnings at Fiscal Period End

1,514,986

33.9

1,465,558

32.5

Net Income Before Tax
Corporate Income Tax, etc.
Net Income

0,¥153,601 thousand
0,0¥49,543 thousand(¥203,145 thousand) ）1,515,918

Extraordinary Losses

others::142 properties
3 properties (Estimate ¥6,423 thousand)0,0¥35,598 thousand
0¥7,200 thousand

others7. Other Non-Operating Expenses
Loan Related Expense: 0, 0¥19,063 thousand*Figures are rounded down to the nearest thousand.

17Balance Sheet
Liabilities and Net Assets

AssetsCurrent Assets

Eighth Fiscal Period

Ninth Fiscal Period

Eighth Fiscal Period

Ninth Fiscal Period

as of Nov. 30, 2010

as of May 31, 2011

as of Nov. 30, 2010

as of May 31, 2011

Amount(￥000)

Amount(￥000)

Amount(￥000)

Amount(￥000)

Ratio
(%)

Ratio
(%)
Current Liabilities

5,894,983

4.2

6,917,539

4.9

Cash and Cash Equivalents

4,593,251

3.3

5,637,715

4.0

Trade Accounts Payable

Cash and Cash Equivalent in Trust

1,199,500

0.9

1,189,218

0.8

Long-term Loan Due Within One Year102,2310.1

90,604

0.1

Other Accounts Payable

Other Current Assets
Fixed Assets

Ratio
(%)

Ratio
(%)

21,372,432

15.2

41,607,789

165,4620.1

165,18829.6
0.1

20,050,000

14.3

40,214,000

28.6 *2

237,5490.2

217,4030.2

134,719,570

95.8

133,582,467

95.1

Taxes Payable

9,481

0.0

24,956

0.0

Tangible Fixed Assets

134,701,287

95.8

133,564,976

95.0 *1

Accrued Expenses

315,1890.2

303,374

0.2

Real Estate

82,898,026

59.0

83,435,078

59.4

Rent Received in Advance

590,360

0.4

598,796

0.4

Building

38,984,343

27.7

39,290,202

28.0

Deposits Payable

4,389

0.0

3,705

0.0

Land

－

－

80,3630.1

55,927,650

39.8

35,661,777

25.4

43,913,682

31.2

44,144,875

31.4

51,803,260

36.8

50,129,898

35.7

Building in Trust

16,840,225

12.0

16,058,868

11.4

Investment Corporation Bonds－－

5,000,000

3.6 *2Land in Trust

34,963,035

24.9

34,071,029

24.2

Long-term Loans

54,626,000

38.8

29,392,000

20.9 *2
0.5

Real Estate in Trust

Intangible Fixed Assets

Provision for Loss on Disaster

Fixed Liabilities

5,579

0.0

4,919

0.0

Security Deposits

703,6450.5

708,551

5,579

0.0

4,919

0.0

Security Deposits in Trust

598,004

0.4

561,226

0.4

Investment and Other Assets

12,7030.0

12,5710.0

77,300,082

55.0

77,269,566

55.0

Security Deposits

10,8790.0

10,8790.0

63,314,471

45.0

63,265,043

45.0

Long-term Repaid Expenses

1,824

0.0

1,692

0.0

Unitholders Capital

61,799,485

43.9

61,799,485

44.0

－

－

34,6030.0

Retained Earnings

1,514,986

1.1

1,465,558

1.0

－

－

34,6030.0

Total Net Assets

63,314,471

45.0

63,265,043

45.0

140,614,554

100.0

140,534,610

100.0

Total Liabilities and Net Assets

140,614,554

100.0

140,534,610

100.0

Other Intangible Fixed Assets

Deferred Assets
Investment Corporation Bond Issuing Expenses
Total Assets*1 Tangible Fixed Assets(unit: millions of yen)
AcquisitionPrice

Accumulated (Depreciation for
depreciation
current FP)

Book value
at FP end

Real Estate

139,417

5,852

(793)

133,564

Building
Land
Building in trust
Land in trust

42,76944,144
18,432
34,071

3,479
－
2,373
－

(547)
－
(245)
－

39,29044,144
16,05834,071

Total Liabilities
Unitholders Equity*2 Loans (long-term loans due within a year are included in the shor-term loans)
74,606

Balance of interest-bearing debts (millions of yen)short-term + long-term loans
Total asset interest-bearing debt ratio

total assets

Long-term interest-bearing debt ratio

shot-term + long-term loans

53.1%

long-term loans

46.1%

18

Forecasts for the Tenth Fiscal Period

Operating Revenue

9th FP Forecast

10th FP Forecast

From Dec. 1, 2010

From Jun. 1, 2011

To May 31, 2011

To Nov. 30, 2011

Amount(millions of yen)Amount(millions of yen)

Assumptions
Difference
Amount(millions of yen)

4,510

4,418

-92

4,497

4,418

-79

13

－

-13

2,333

2,295

-38

1,838

1,778

-59

Repair Expenses

153

163

10

Tax and Public Dues

215

222

7

Depreciation and Amortization

793

804

11

Real Estate Disposition Espenses

2

－

-2

Asset Management Fees

319

322

2

Other Operating Expenses

173

194

21

Operating Income

2,177

2,122

-54

-623

-644

-20

-602

-598

3

1,553

1,478

-74

87

－

-87

1,465

1,477

12

Real Estate Rental Business Revenues
Real Estate Disposition Revenue
Operating Expense
Real Estate Rental Business Expenses

Non-Operating Profit and Loss
Interest Expenses
Current Profits
Extraordinary Losses
Net Income[Number of Properties]
Number of Properties:
144 properties
Total Amount of Acquisition Price : ¥134,140 million[Repair Expenses]

Number of Investment Units Issued(units)125,535

125,535－

Cash Distribution Per Unit(y en)

11,674

11,770

96

143

144

1

Number of Properties(properties)

Leasable Floor Area(sqm)

214,215

217,757

3,542

Occupancy Rate Assumption

(%)

96.1

95.8

-0.3

¥203 million for 9th Fiscal Period(of which ¥49 million is capital expenditure)
Example)US Asakusa (entrance renovation)
US Karasuyama (large-scale renovation): ¥2 million: ¥13 million¥212 million for 10th Fiscal Period(of which ¥48 million is capital expenditure)
Example)US Sangen Jaya (large-scale renovation)
US Tsurumi Teraya (large-scale renovation): ¥20 million: ¥20 million[Loans]Total Interest-bearing Debt (as of July 20, 2011)¥74,606 million

Interest-bearing Debt Repayment Due During 10th FP
Repayment through loans (Aug-Sep 2011)
Agreed repayment (Aug-Sep 2011)¥14,590 million¥390 million¥14,980 million

Difference in Forecasts
Announced
June 1, 2011

Announced
July 15, 2011

Difference

Operating Revenue¥4,375 million¥4,418 million+￥43 million

Operating Income¥2,103 million¥2,122 million+￥19 million

Net Income¥1,463 million¥1,477 million+￥14 million

Cash Distribution per Unit

¥11,660¥11,770+￥110

19Fund Management Results

20Changes in Asset Size
Stable Growth of Portfolio(billion yen)

160

140

131 properties¥110.33 billion

120

100

80

IPO
¥30,257 million
89 properties¥67.03 billion

134 properties¥115.93 billion

139 properties¥121.48 billion#2 PO¥8,029 million 143 properties¥131.46 billion
139 properties¥121.48 billion

144 properties¥133.41 billion

143 properties¥132.89#1 PO¥12,514 million
97 properties¥75.42 billion

Replacement

Replacement

Acquire 2 Properties
Dispose 1 Property

Acquire 2 Properties
Dispose 2 Properties

60

40* Greater Tokyo Area: 87.0%
Other Areas: 13.0%

200
1st FP End(May 31, 2007)

2nd FP End(Nov. 30, 2007)

3rd FP End(May 31, 2008)

4th FP End(Nov. 30, 2008)

5th FP End(May 31, 2009)

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)*The graph above is based on the acquisition price of each property (rounded down to the nearest thousand).

Portfolio Overview (Ninth Fiscal Period End)
Acquisition Price
Leasable Units¥132,890 million

7,596 units

Average Rent Per Unit

approx. ¥95 thousand

Average Leasable Floor Area Per Unit approx. 28 sqm
21

Portfolio Occupancy Rate
Portfolio Occupancy Rate
8th Fiscal Period

9th Fiscal Period

Average : 95.9%

Average : 96.0%(sqm)
300,000

250,000

95.8%

95.2%

- Value increasing renovations- Gather corporate tenant needs
96.2%
95.8%

Greater Tokyo Area

96.0%

96.3%

95.9%

95.8%

96.5%
95.6%

95.9%

96.1%
Other Areas

94.7%
200,000

100.0%

Dynamic leasing activity during the busy season

93.4%

93.2%

94.8%

95.1%

95.1%

95.2%

95.8%

96.3%

95.8%

95.0%
95.4%

3.11 Great Eastern Japan Earthquake

93.3%+ US Itabashi Kuyakusho- US Tennocho+ US Yoga＋US Kasai East

- PU Ebisu Minami

Portfolio Occupancy
Rate- US Yono Hommachi

90.0%
J－REIT Owned
Rental Housing
Average Occupancy
Rate

150,000
85.0%
100,000

80.0%
50,0000

Area
Portfolio
GreaterTokyo Area
Other
Areas

75.0%
平成22年
Jun
6月
2010

Jul

Aug

Sep

Oct

Nov

Dec

平成23年
Jan
1月
2011

Feb

Mar

Apr

May

7月

8月

9月

10月

11月

12月

2月

3月

4月

5月

95.2%

95.8%

95.8%

96.2%

96.0%

96.3%

95.9%

95.8%

95.6%

96.5%

95.9%

96.1%

94.9%

95.6%

95.7%

95.9%

95.7%

96.0%

95.0%

95.6%

94.4%

96.1%

95.4%

95.7%

95.9%

96.4%

96.2%

97.0%

97.0%

97.2%

96.6%

96.7%

96.5%

98.0%

97.3%

97.5%

Leasable Floor Area at FP End
Greater Tokyo Area : 165,989 sqm
Other Areas : 048,226 sqm
Total : 214,215 sqm* “J-REIT Owned Rental Housing Average Occupancy Rate” is based on data from The Investment Trusts Association, Japan.

Maintaining high occupancy rates from the end of last period(8th FP End Occupancy Rate: 96.3% → 9th FP End Occupancy Rate: 96.1%)
22

Changes in Revenue (1)Changes in Leasable Units and Rent Per Unit
(units)
7,500

8th FP End(7,318 units)

Terminations(1,133 units)*2

New Lease(1,124 units)

9th FP End(7,296 units) Occupancy Rate

Acquisition: 78 units
Disposition: 91 units

7,000

6,500

Property
Replacement
Difference(- 13 units)

Maintained high occupancy rates in bothGreater Tokyo Area and Other Areas
Occupancy
Rate
96.3%

Occupancy
Rate
96.1%

Renewals(6,172 units)

Greater Tokyo Area [ 96.0%→

95.7% ]

Other Areas→

97.5% ]

[ 97.2%

 Rent per Tsubo (11,295 yen → 11,156 yen －1.2%)

6,000

Properties

5,500
*1

8th FP End
Units( 96.3% → 96.1% )(unit)

Rent Level (yen/tsubo)

Property Replacement
Continued Lease
Increase/Decrease(includeds renew als)

Cancellations

New Lease

Difference

Notes

Portfolio at 8th FP End－089 yen

142 properties(－ 0.8 %)9th FP Property Replacement－050 yen

Acquire 1 property
Dispose 2 properties(－ 0.4 %)Portfolio at 9th FP End－139 yen¥11,295 → ¥11,156(－ 1.2 %)9th FP End

7,318

-13

6,172

1,133

1,124

7,296

11,295

10,643

11,203

11,477

10,894

11,156*As the property acquired due to property replacement is also renting out its common area, rent per tsubo calculation is reduced.

(1) Details of Lease Renewals(2) Details
of New Lease※2
新規契約内容8th FP End

9th FP End

DifferenceContinued Lease,0860 units

1,448 units＋588 units

Renewal Rate*

085.3 %

080.0 %

－ 5.3 pt

Increase

000.0 %

001.0 %

＋ 1.0 pt

8th FP End

9th FP End

Difference

New Lease.798 units.1,124 units.＋.326 units

Turnover Rate*

10.5 %

0,14.8 %＋04.3 pt

Increase

11.0 %

0.18.6 %＋07.6 pt

Flat

090.0 %

096.3 %

＋ 6.3 pt

Flat

09.4 %

0.10.6 %＋01.2 pt

Decrease010.0 %

002.6 %

－ 7.4 pt

Decrease

79.6 %.070.8 %－08.8 pt

*Renewal Rate = Number of renewed units / Number of units that have reached time of renewal* Turnover Rate = Newly leased units / Total Number of leasable units(Based on regularly occupied properties)

23

Changes in Revenue (2)Changes in Rent per Tsubo and Occupancy Rate (6th FP End-10th FP End (forecast))[Rent per Tsubo](Rent per Tsubo)

Rent/Tsubo (Greater Tokyo Area)

Rent/Tsubo (Other Areas)

Rent/Tsubo (Total)(Reference)

15,000

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)

10th FP End(Forecast)(Nov. 30, 2011)

Total

11,276

11,372

11,295

11,156¥11,072

GreaterTokyo

12,626

12,663

12,551

12,388

－

Other
Areas

7,090

7,055

7,026

6,996

－

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)

10th FP End(Forecast)(Nov. 30, 2011)

Total

92.8%

95.2%

96.3%

96.1%

95.8%

Greater
Tokyo

93.0%

94.9%

96.0%

95.7%

－

Other
Areas

92.2%

95.8%

97.2%

97.5%

－

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)

10th FP End(Forecast)(Nov. 30, 2011)

8.4%

15.4%

10.5%

14.8%

8.4%

Previous FP
Forecast¥11,270
Rent
per Tsubo

Total
10,000

Forecast(Reference)¥11,276¥11,372¥11,295¥11,156¥11,072

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)

10th FP End (f orecast)(Nov. 30, 2011)

Details

5,000[Occupancy Rate]
Occupancy Rate (%)

Greater Tokyo Area

Other Areas(Reference)

Total

100.0

Occupancy
Rate
95.0

96.3%
95.2%

Total
90.0

96.1%

Forecast(Reference)

95.8%

Details

Previous FP

92.8%

Forecast
96.1%(Reference)(Reference)
85.0

6th FP End(Nov. 30, 2009)

7th FP End(May 31, 2010)

8th FP End(Nov. 30, 2010)

9th FP End(May 31, 2011)

10th FP End (f orecast)(Nov. 30, 2011)

Turnover
Ratio(Total)24

Engage in Asset Management
Measures Taken to Enhance Occupancy Rate
Shorten Vacant Period

Lease Cancellation
Enhance competitiveness of property throughspecifics and furnishing renovations

New Lease Agreement
Use model apartments for units for rent

Utilize vacant unit

- Change floor surface(Carpet to Flooring)- Develop a lived-in feel as model apartments- Encourage lease to other apartments- Change air conditioner and wallpaper

Shorten Vacant Period

ＰＵ Chitose Funabashi (model apartment)

US Toritsu Daigaku

Addressing Energy Saving
 Other Power conservation [incandescent light bulb → LED light bulb]
PF Waseda

Entrance- Thin out common area lights and turn off certain lights at night- Change common area lighting to LED lights- Notify tenants to cooperate in conserving energy
LED Light Bulb

- Turn off display lights of vending machines*Power consumption : Approx. 1/5

Stairway* Change from 25w incandescent light bulb to 4.5w LED light bulb: 4.5/25 ≒ 1/5

25

Management Results
Keep/Enhance Market Competitiveness and Seek Internal Growth Opportunities
Renovations During the Ninth Fiscal Period
URBAN STAGE Karasuyama

URBAN STAGE Asakusa

 Enhance market competitiveness through building entrance renovation

 Renovate common area to enhance market appeal- Better image of common area through lighting modifications- Also renovate entrance hall

May 31, 2011
Occupancy Rate

- Change wall design and floor surface to enhance quality

100.0 %

May 31, 2011
Occupancy Rate

94.7 %

Seek Internal Growth Opportunities
 Procurement of incidental revenues(Continue to install cell phone antennas and vending machines) Curtail building management expenses (Curtail building management fees) Curtail other expenses(Integrate various commission companies)

Approx. ¥13 million
Improvement of profit(per annum)

26

Financial Status (Ninth Fiscal Period End)Interest-bearing Debt

Maturity Diversification¥74,606 million

Interest-bearing Debt Total(millions of yen)
30,000Investment Corporation Bonds

Average Remaining Duration of Long-term Loans 2.8 years

Repayment
Date

Amount(millions of yen)Aug. 26, 2011

8,040

The Bank of Tokyo-Mitsubishi UFJ

8 Others

Sep. 4, 2011

3,400

Mizuho Corporate Bank

2 Others

Sep. 30, 2011

3,500

The Bank of Tokyo-Mitsubishi UFJ

5 Others

25,00020,0001.61 %

Weighted Average Interest Rate

Loans

[Details]

25,234 *Lender14,98015,00046.1 %

Long-term Interest-bearing Debt Ratio

10,0006,61074.8 %

Loan Interest Rate Fixed Ratio

7,190

6,362
5,090

4,090

5,000

2,390

53.1 %

LTV Level*Investment Corporation Bonds are included in the “Interest-bearing Debt.”*Long-term Ratio, when including “long-term loans due within a year” in long-term loans, is 100.0%.
*“Loan Interest Rate Fixed Ratio” includes floating rate loans which have been fixed through interest rate swaps.

90

90

1,130

1,350

20th
FP

21st
FP

0
10th
FP

11th
FP

12th
FP

13th
FP

14th
FP

15th
FP

16th
FP

17th
FP

18th
FP

19th
FP

*Date of Repayment: Dec. 2011 (¥14,144 million), Feb. 2012 (¥11,000 million/installment repayment ¥90 million)

Credit Rating

Lender Diversification (16 Lenders)(millions of yen)

AgencyJCR

RatingOutlookLong-term Senior Debt Rating: AA

StableLong-term Corporate Credit Rating: A

StableS&P
Short-term Corporate Credit Rating: A－1

Major Banks (3)Trust Banks (3)Regional Banks (3)The Bank of Tokyo-Mitsubishi UFJ

11,372 Mitsubishi UFJ Trust and Banking

11,372 The Iyo Bank

1,000

Sumitomo Mitsui Banking

11,372 The Sumitomo Trust and Banking

4,920 The Bank of Fukuoka

1,000

Mizuho Corporate Bank

6,920 The Nomura Trust and Banking

3,500 The Chiba Bank

Insurance Companies (4)Others (3)Taiyo Life Insurance

3,000 Development Bank of Japan

Mitsui Sumitomo Insurance

2,100 Aozora Bank

Daido Life Insurance

1,100 Shinkin Central BankThe Dai-ichi Life Insurance

750

8,180
500
1,720

800

27

Appraisal Value Status (Ninth Fiscal Period End)
Appraisal Value
Appraisal Value Details
8th FP End Appraisal Value (A)*¥120,904 million

9th FP End Appraisal Value (B)¥121,042 million

 Increase

57 properties ( 039.8 %) Flat38 properties ( 026.6 %) Decrease 48 properties ( 033.6 %)+ ¥138 million

Difference (A)-(B)Total

143 properties ( 100.0 %)*“8th FP End Appraisal Value” includes the appraisal value at the time of acquisition of the 1 property
acquired during the 9th FP. It also excludes the appraisal value of 2 properties disposed during the 9th FP.

Range of Cap Rate, Appraisal Value, and Book-to-Market Ratio
継続鑑定評価額
Appraisal Value(Billions of（億円）
yen)

5.61％

1,750
175

1,500
150

（％）

5.58％

5.57％

（ -0.03pt）（- 0.01pt）

5.43％

5.65

5.55％
（- 0.02pt）
5.40

Capキャップレート低下傾向
Rate Downward Trend

1,250
125

1,000
100

Book-to-Market Ratio*
時価簿価比※

Average Cap Rate
平均キャップレート

5.18％

5.14％

5.15

5.05％

5.04％

0.99倍
0.99x

1.00倍
1.00x

0.98倍
0.98x

0.96倍
0.96x

0.92倍
0.92x

0.89x
0.89倍

0.90x
0.90倍

0.90x
0.90倍

0.90x
0.90倍

1st FP

2nd FP

3rd FP

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

Average Cap Rate

5.14 %

5.05 %

5.04 %

5.18 %

5.43 %

5.61 %

5.58 %

5.57 %

5.55 %

Appraisal Value￥67.57 billion￥76.66 billion ￥111.47 billion ￥113.55 billion ￥113.57 billion ￥109.34 billion ￥119.47 billion ￥121.23 billion ￥121.04 billion

Total Book Value￥68.32 billion￥76.83 billion ￥113.51 billion ￥118.81 billion ￥124.09 billion ￥123.54 billion ￥133.27 billion ￥134.70 billion ￥133.56 billion

75
750

50
500

Book-to-Market Ratio*
0.99 x1.00 x*Book-to-Market Ratio=Appraisal Value/Book Value

0.98 x0.96 x0.92 x0.89 x0.90 x0.90 x4.90

0.90 x28

Unitholders (Ninth Fiscal Period End)
Changes in Number of Units Held by Unitholders and the Ratio
125,535 units(units)120,000*

100,000

 Increase in mutual funds

80,000 Investing resumes forregional financial institutions

19.8%

12.1%

9.7%

19.6%

10.6%

Foreign Corporations, etc.
( 13,256 units / 102 unitholders )

15.1%

15.4%

15.4%

Domestic Corporation (excluding Financial Institutions)( 19,001 units / 151 unitholders )16.1%

40,00020,000Individuals/Others( 21,185 units / 8,444 unitholders )16.9%

96,765 units

11.2%
60,000

20.6%

53.1%

51.9%

55.1%

57.4%

第7期
7th
FP

第8期
8th
FP

第9期
9th
FP

Financial Institutions (including Securities Companies)( 72,093 units / 92 unitholders )

0
第6期
6th
FP
(Financial Institutions)Total

51,380 units

53.1%

65,108 units

51.9%

69,161 units

55.1%

72,093 units

57.4%

Banks

6,466 units

6.7%

6,436 units

5.1%

6,043 units

4.8%

6,131 units

4.9%

Trust banks

32,544 units

33.6%

44,642 units

35.6%

47,733 units

38.0%

53,258 units

42.4% Increase in Mutual Funds

Life Insurance

1,309 units

1.4%

3,311 units

2.6%

3,505 units

2.8%

3,435 units

2.7%

Non-life Insurance

5,165 units

5.3%

3,191 units

2.5%

2,210 units

1.8%

1,665 units

1.3%

Securities Companies, etc.

337 units

0.3%

1,087 units

0.9%

3,233 units

2.6%

2,127 units

1.7%

Other

5,559 units

5.7%

6,441 units

5.1%

6,437 units

5.1%

5,477 units

4.4%

Top 10 Unitholders
Units

Ratio (%)

#

Units

Ratio (%)

1#

Japan Trustee Services Bank, Ltd.

Unitholders

27,64322.02

6

Nomura Bank (Luxembourg) S.A.

Unitholders

3,383

2.69

2

Nomura Real Estate Development Co., Ltd.

15,24012.14

7

AIG Edison Life Insurance Company GA Equity PIMJ

2,394

1.91

3

The Nomura Trust and Banking Co., Ltd.

10,891

8.68

8National Mutual Insurance Federation of Agriculture Cooperatives

1,460

1.16

4

Trust and Custody Services Bank, Ltd.

6,245

4.97

9

The Senshu Ikeda Bank, Ltd.

1,161

0.92

5

The Master Trust Bank of Japan, Ltd.

5,922

4.72

10 Mizuho Trust & Banking Co., Ltd.

1,072

0.85

Total

75,411

60.07(Note) The Ratio is calculated as the percentage of Total Number of Owned Investment Units divided by Total Number of Issued Investment Units.

29Changes in Investment Unit Price and Cash Distribution
Changes in Investment Unit Price
Investment Unit Price

TSE REIT Index

1,000,000

Investment Unit Price

平成19年3月29日
Mar. 29, 2007
HighestPrice: ¥979,000
最高値：979,000円

900,000
800,000

Mar. 14, 2011
BOJ announces Additional
Purchase of J-REIT

September 2008
Lehman Brothers
Bankruptcy

700,000

Recommence
Public Offerings
Nikkei Stock AverageMar. 10, 2009
Lowest: 7,054.98

600,000

Mar. 11, 2011
Great Eastern Japan
Earthquake

Recommence
Issuance of Investment
Corporation Bonds

Oct. 5, 2010
BOJ announces
Purchase of J-REITs

500,000

3,000

2,500

2,000

1,500
• BPS ¥504 thousand

400,000
1,000

300,000
200,000500

平成21年1月15日
Jan. 15, 2009
LowestPrice: ¥287,600
最安値：287,600円

100,000
00
May 31
2007

Feb. 142007
1st FP

May 31
2008

Nov. 30
2007
2nd FP

3rd FP

Nov. 30
2008
4th FP

Nov. 30
2009

May 312009
5th FP

6th FP

May 312010
7th FP

Nov. 302010
8th FP

9th FP

11,674

11,770(Forecast)

9th FP End
May 31, 2011

10th FP End
Nov. 30, 2011

Changes in Cash Distribution
20,00016,00014,14414,005

13,91013,631
12,06812,127
11,046

12,000

8,102
8,000

4,000

0

1st FP End
May 31, 2007

2nd FP End
Nov. 30, 2007

3rd FP End
May 31, 2008

4th FP End
Nov. 30, 2008

5th FP End
May 31, 2009

6th FP End
Nov. 30, 2009

7th FP End
May 31, 2010

8th FP End
Nov. 30, 2010

May 31, 2011
¥464,500

ＡＰＰＥＮＤＩＸ

31

Changes in Financial Performance

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

Operating Revenues

million y en

3,809

4,025

3,959

4,323

4,466

4,510

Operating Income

million y en

1,890

1,949

1,926

2,037

2,150

2,177

Net Income

million y en

1,368

1,345

1,319

1,386

1,514

1,465

Asset Total

million y en

124,705

130,433

128,433

138,755

140,614140,534

Interest-bearing Debt Total

million y en

67,23672,99670,97673,04674,676

74,606

Net Asset

million y en

55,13855,11555,08863,18663,31463,265Return on Assets (ROA)

%

2.2

2.1

2.0

2.0

2.2

2.2

5.0

4.9

4.8

4.4

4.8

4.6

Return on Equity (ROE)%

FP End Capital Adequacy Ratio

%

44.2

42.3

42.9

45.5

45.0

45.0

LTV

%

53.9

56.0

55.3

52.6

53.1

53.1

times

3.8

3.4

3.3

3.4

3.5

3.4

%

1.55

1.57

1.61

1.61

1.62

1.61

y ears

3.5

2.8

2.8

2.4

2.1

2.8

million y en

3,039

3,138

3,125

3,300

3,459

3,452

%

5.24

5.17

5.15

5.02

5.19

5.20

FFO

million y en

2,064

2,089

2,055

2,174

2,305

2,251

Portfolio

properties

134

139

139

143

144

143

Acquisition Price Total

million y en

115,939

121,482

121,482

131,462

133,416

132,890

Book Value Total

million y en

118,818

124,095

123,545

133,272

134,701

133,564

Appraisal Value Total

million y en

113,555

113,576

109,349

119,471

121,231

121,042

NAV per Unit

thousand y en

515

460

422

393

397

404

Interest Coverage Ratio
Weighted Average Interest Rate
Long-term Debt
Average Remaining Duration
Rent NOINOI Yield (acquisition price base)

ROA=Current Profits/[(Total Asset Value at Start of FP+Total Asset Value at FP End)÷2]x100 *annual basis
ROE=Net Income/[(Total Asset Value at FP Start+Total Asset Value at FP End)÷2]x100 *annual basis
Capital Adequacy Ratio at FP End=Net Asset at FP End/Total Asset at FP End x 100
LTV=Total Interest-bearing Debt at FP End/Total Asset at FP End x 100
Interest Coverage Ratio=Net Income Before Interest Depreciation/(Interest Expenses+Investment Coroporation Bond Interest)

Rent NOI=Real Estate Rental Business Revenues-Real Estate Rental Business Income+Current FP Depreciation and Amortization
NOI Yield (Acq uisition Price Base)=Rent NOI/Total Acq uisition Price x 100 *annual basis
FFO=Net Income+Current FP Depreciation and Amortization+Investment Corporation Bond Issuance Ammortization-Real Estate Disposition Profit & Loss
NAV per Unit=[Net Asset Total-(Income Statement Total-Appraisal Value Total)]/Total Number of Investment Units Issued

32Interest-bearing Debts (Ninth Fiscal Period End)
LenderShort-term Loan
Sub Total

Amount(Millions of Yen)

Type ofInterest

Interest Rate

Date of
Loan

Date of
Repayment

Remaining
Period8 Financial Institutions

7,990

Floating Rate

1.30000%

Feb. 26, 2010

Aug. 26, 2011

0.2 years

3 Financial Institutions

3,400

Fixed Rate

1.51625%

Sep. 4, 2008

Sep. 4, 2011

0.3 years

6 Financial Institutions

3,500

Fixed Rate (*1)

1.84464%

May. 31, 2007

Sep. 30, 2011

0.3 years

2 Financial Institutions

5,048

Fixed Rate (*1)

1.43250%

Dec 26, 2008

Dec. 26, 2011

0.6 years

2 Financial Institutions

9,096

Floating Rate

1.23000%

Jun. 28, 2010

Dec. 26, 2011

0.6 years

7 Financial Institutions

11,000

Fixed Rate (*1)

1.79300%

Feb. 27, 2007

Feb. 27, 2012

0.7 years

1 Financial Institution

80

Fixed Rate

2.10000%

Aug. 27, 2009

(Note 2)－

1 Financial Institution

100

Fixed Rate

2.03000%

Feb. 26, 2010

(Note 3)－10 Financial Institutions

40,214

－

－

－

－

－

2 Financial Institutions

2,200

Fixed Rate

1.81375%

Apr. 27, 2007

Aug. 27, 2012

1.2 years

5 Financial Institutions

2,600

Fixed Rate (*1)

1.49300%

Aug. 27, 2009

Aug. 27, 2012

1.2 years

1 Financial Institution

1,720

Floating Rate

1.26000%

Sep. 7, 2010

Aug. 27, 2012

1.2 years

4 Financial Institutions

1,600

Fixed Rate (*1)

1.51625%

Dec. 3, 2009

Dec. 3, 2012

1.5 years

3 Financial Institutions

5,500

Fixed Rate

1.83625%

May 23, 2008

May 23, 2013

2.0 years

3 Financial Institutions

5,472

Fixed Rate (*1)

1.74250%

Sep. 29, 2008

Sep. 29, 2013

2.3 years

1 Financial Institution

800

Fixed Rate

1.99875%

Sep. 27, 2007

Sep. 30, 2013

2.3 years

2 Financial Institutions

2,000

Fixed Rate (*1)

2.14360%

Feb. 27, 2007

Feb. 27, 2014

2.7 years

1 Financial Institution

2,000

Fixed Rate

2.13625%

Feb. 27, 2007

Feb. 27, 2014

2.7 years

1 Financial Institution

1,000

Fixed Rate (*1)

1.79200%

Feb. 26, 2010

Feb. 26, 2015

3.7 years

1 Financial Institution

1,300

Fixed Rate

2.23500%

May 15, 2007

Feb. 27, 2015

3.7 years

1 Financial Institution

1,400

Fixed Rate

2.10000%

Aug. 27, 2009

(Note 2)－

Collateral

Unsecured
Unguaranteed－

Unsecured
Unguaranteed

1 Financial Institution

1,800

Fixed Rate

2.03000%

Feb. 26, 2010

(Note 3)－Long-term Loan
Sub Total

13 Financial Institutions

29,392

－

－

－

－

－

Loan Total

16 Financial Institutions

69,606

－

－

－

－

－

－

－

Investment
Corporation Bond

－

5,000

－

1.21000%

Feb 25, 2011

Feb. 25, 2016

4.7 years

Unsecured
Unguaranteed

Total

－

74,606

－

－

－

－

－

－

(*1) The interest rate stated regarding this loan takes into consideration the Interest Rate Sw ap transaction.
(*2) The amount of ￥40 million to be repayed on February 27, 2010、the first repayment date, and every August 27 and February 27 thereafter, until the last repayment of ￥ 1,080 million on August 27, 2016.
(*3) The amount of ￥50 million to be repayed on August 26, 2010, the first repayment date, and every February 26 and August 26 thereafter, until the last repayment of \1,350 million on February 26, 2017.

33

Portfolio Status (Ninth Fiscal Period End)

12.

3%■Top 5 Properties¥16.37 billion

Diversification Within Assets

21.0%

79.0%

21.

■Other 133 Properties¥104.99 billion

0%■Top 10 Properties¥27.90 billion

87.

13.0%

Investment Area

■Over 10 years

7.

7%■1-3 years

Considering the combination ofvarious building age to avoid thebias of large-scale repair
expenses

Improve portfolio stability
through promotion ofdiversification⇒Top 10 Properties

25.3%

Building Age

0%■Greater Tokyo Area

■Other Areas⇒Average Building Age
8.5 Years

Floor Area Per Unit

22.9%

■5-10 years

0.

9%■Over 70 sqm

44.

1%■3-5 years

0.4%■Retail & Office6.

3%■50-70 sqm

14.5%
Greater Tokyo Area 70% or more

Investing in properties targeting
single/DINKS/young family
households for theforeseeable future

Other Areas(Kanagawa, Chiba, Saitama)

Other Areas 30% or less⇒Greater Tokyo Area 87.0%

69.1%

3.4%
Tokyo (excluding the 23 wards)

Nearest Station on Foot

7.7%
■Over 10 min.

Selection focusing onaccessibility to the nearest
railway stations⇒Within 10 min.

92.3%

⇒Under 50 sqm

92.4%

Tokyo (23 wards)

51.6%■Within 5 min.

17.4%

■30-50 sqm

18.2%
Units Per Property■Over 100 Units

75.

0%■Under 30 sqm

9.

5%■Under 30 Units

Investing in properties withstrong lease-up potential in ashort timeframe

40.6%■5-10 min.

⇒Average Unit Per Property
53 Units

44.0%■50-100 Units

28.

3%■30-50 Units*Of the graphs above, “Floor area per unit” is based on units, the others are based on acquisition price.

34

Portfolio Map (143 Properties)
Minami Urawa

Saitama

Greater Tokyo Area

116 Properties
Adachi-ku

Itabashi-ku

Kita-ku

Chiba

Nerima-ku

Katsushika-ku

Toshima-ku

Arakawa-ku

IkebukuroBunkyo-ku

Takadanobaba
TachikawaTaito-ku

Ueno

Sumida-ku

Kichijoji

Edogawa-ku
Suginami-ku

Shinjuku-ku

Nakano-ku

Nishi
Funabashi

Shinjuku
Chiyoda-ku

TokyoKoto-ku
Shibuya-ku

Chuo-ku

Minato-ku

Urayasu

Shibuya

Other Areas

27 Properties
Setagaya-ku

Sapporo 11 properties

ShinagawaMeguro-ku

Shinagawa-ku

Sendai5 properties
Osaka
3 properties

Kanagawa
Ota-kuHaneda Airport

Nagoya3 properties

Yokohama

Fukuoka
5 properties

JR Lines
Other Lines*Greater Tokyo Area
(Tokyo, Kanagawa, Chiba, Saitama)

35

Portfolio
#
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36

Name of Property
PROUD FLAT Shirokane Takanawa
PROUD FLAT Yoyogi Uehara
PROUD FLAT Hatsudai
PROUD FLAT Shibuya Sakuragaoka
PROUD FLAT Gakugei Daigaku
PROUD FLAT Meguro Gyoninzaka
PROUD FLAT Sumida Riverside
PROUD FLAT Kagurazaka
PROUD FLAT Waseda
PROUD FLAT Shinjuku Kawadacho
PROUD FLAT Sangen Jaya
PROUD FLAT Kamata
PROUD FLAT Kamata II
PROUD FLAT Shinotsuka
PROUD FLAT Kiyosumi Shirakawa
PROUD FLAT Monzen Nakacho II
PROUD FLAT Monzen Nakacho I
PROUD FLAT Asakusa Komagata
PROUD FLAT Yokohama
PROUD FLAT Kamioooka
PRIME URBAN Akasaka
PRIME URBAN Tamachi
PRIME URBAN Yoyogi
PRIME URBAN Bancho
PRIME URBAN Chiyoda Fujimi
PRIME URBAN Iidabashi
PRIME URBAN Ebisu
PRIME URBAN Naka Meguro
PRIME URBAN Gakugei Daigaku
PRIME URBAN Senzoku
PRIME URBAN Meguro Riverside
PRIME URBAN Meguro Ohashi Hills
PRIME URBAN Hakusan
PRIME URBAN Yotsuya Gaien Higashi
PRIME URBAN Nishi Shinjuku I
PRIME URBAN Nishi Shinjuku II

Location
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Chuo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Taito-ku, Tokyo
Yokohama-shi, Kanagawa
Yokohama-shi, Kanagawa
Minato-ku, Tokyo
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Bunkyo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo

Acquisition Price
Percentage Leasable Floor
Leasable
Occupancy Rateof Total (%)
Area (sqm)
Units (units) (end of 9th FP)(%)(thousands of yen)
3,510,000
2.6
2,950.11
106
97.8
1,100,000
0.8
1,151.34
44
89.8
865,000
0.7
958.9831
100.0
800,000
0.6
638.7030
96.7
812,000
0.6
934.3941
95.4
882,000
0.7
855.2340
97.5
2,260,000
1.7
3,055.21
110
97.5
1,540,000
1.2
1,793.4370
100.0
1,110,000
0.8
1,450.9160
95.4
1,010,000
0.8
1,102.20
41
94.3
1,350,000
1.0
1,277.82
48
88.5
1,140,000
0.9
1,541.64
67
97.2
2,980,000
2.2
4,051.72
169
97.5
695,000
0.5
752.0935
91.6
900,000
0.7
1,209.5655
100.0
650,000
0.5
830.5535
97.4
1,130,000
0.9
1,191.08
55
100.0
1,960,000
1.5
2,685.39
79
91.4
2,340,000
1.8
3,118.12113
92.9
2,770,000
2.1
4,872.17200
100.0
956,000
0.7
1,062.05
25
100.0
941,000
0.7
1,107.36
48
94.0
408,000
0.3
439.5619
94.2
1,170,000
0.9
1,277.04
52
96.2
707,000
0.5
793.8732
90.3
2,030,000
1.5
2,087.70
90
98.9
1,200,000
0.9
1,444.40
29
96.7
1,320,000
1.0
1,302.4249
93.9
886,000
0.7
1,008.3932
96.7
536,000
0.4
655.272294.9
464,000
0.3
453.7724
96.0
3,580,000
2.7
2,955.74
99
98.2
893,000
0.7
1,069.8242
100.0
1,700,000
1.3
1,759.1151
93.9
1,290,000
1.0
1,459.8660
90.3
1,000,000
0.8
1,162.55
46
97.9

36

Portfolio
#
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72

Name of Property
PRIME URBAN Shinjuku Naitomachi
PRIME URBAN Nishi Waseda
PRIME URBAN Sangen Jaya
PRIME URBAN Minami Karasuyama
PRIME URBAN Karasuyama Galleria
PRIME URBAN Karasuyama Court
PRIME URBAN Chitose Funabashi
PRIME URBAN Shinagawa Nishi
PRIME URBAN Osaki
PRIME URBAN Omori
PRIME URBAN Kita Senzoku
PRIME URBAN Denenchofu Minami
PRIME URBAN Nakano Kamitakada
PRIME URBAN Nishi Ogikubo
PRIME URBAN Otsuka
PRIME URBAN Monzen Nakacho
PRIME URBAN Kameido
PRIME URBAN Sumiyoshi
PRIME URBAN Kinshi Koen
PRIME URBAN Kinshicho
PRIME URBAN Hirai
PRIME URBAN Kasai
PRIME URBAN Kasai II
PRIME URBAN Shinyurigaoka
PRIME URBAN Urayasu
PRIME URBAN Gyotoku I
PRIME URBAN Gyotoku II
PRIME URBAN Gyotoku Ekimae
PRIME URBAN Nishi Funabashi
PRIME URBAN Kawaguchi
URBAN STAGE Azabu Juban
URBAN STAGE Shibaura LOFTURBAN STAGE Hatagaya
URBAN STAGE Toritsu Daigaku
URBAN STAGE Kachidoki
URBAN STAGE Shinkawa

Location
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Nakano-ku, Tokyo
Suginami-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Sumida-ku, Tokyo
Sumida-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Kawasaki-shi, Kanagawa
Urayasu-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Funabashi-shi, Chiba
Kawaguchi-shi, Saitama
Minato-ku, Tokyo
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo
Chuo-ku, Tokyo
Chuo-ku, Tokyo

Acquisition Price
Percentage Leasable Floor
Leasable
Occupancy Rateof Total (%)
Area (sqm)
Units (units) (end of 9th FP)(%)(thousands of yen)
512,000
0.4
578.1814100.0
503,000
0.4
507.1128
100.0
835,000
0.6
874.1533
100.0
840,000
0.6
1,049.7341
92.8
645,000
0.5
835.0533
94.0
413,000
0.3
576.2023
100.0
885,000
0.7
1,027.4438
90.1
624,000
0.5
961.2546
97.9
1,700,000
1.3
2,106.16
99
95.0
824,000
0.6
1,190.70
54
94.4
576,000
0.4
834.9046
95.7
900,000
0.7
1,100.1744
97.4
640,000
0.5
818.7533
100.0
435,000
0.3
543.0924
96.1
794,000
0.6
944.9946
97.9
2,200,000
1.7
3,207.92
118
98.3
705,000
0.5
1,117.3452
100.0
552,000
0.4
813.5240
97.5
1,180,000
0.9
1,886.50
77
93.5
668,000
0.5
991.6249
100.0
700,000
0.5
1,095.91
53
98.1
637,000
0.5
905.8145
100.0
958,000
0.7
1,437.84
68
98.5
1,210,000
0.9
1,708.1964
100.0
840,000
0.6
1,264.8460
98.3
635,000
0.5
1,151.36
52
98.1
741,000
0.6
1,244.00
58
100.0
476,000
0.4
778.1937
94.6
772,000
0.6
1,237.8060
95.0
2,170,000
1.6
2,477.11
98
95.1
991,000
0.7
1,222.1340
97.9
1,510,000
1.1
1,905.3968
98.0
452,000
0.3
650.6038
100.0
524,000
0.4
996.8116
87.4
2,290,000
1.7
4,524.00
145
94.4
2,250,000
1.7
3,600.61
46
93.1

37

Portfolio
#
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108

Name of Property
URBAN STAGE Nihonbashi Yokoyamacho
URBAN STAGE Hongo Ikizaka
URBAN STAGE Naka Ochiai
URBAN STAGE Ochiai
URBAN STAGE Shinjuku Ochiai
URBAN STAGE Roka Koen
URBAN STAGE Kamiuma
URBAN STAGE Sangen Jaya
URBAN STAGE Chitose Karasuyama
URBAN STAGE Sangen Jaya II
URBAN STAGE Komazawa
URBAN STAGE Karasuyama
URBAN STAGE Kamikitazawa
URBAN STAGE Yoga
URBAN STAGE Oimachi
URBAN STAGE Oimachi II
URBAN STAGE Yukigaya
URBAN STAGE Ikegami
URBAN STAGE Nakano
URBAN STAGE Takaido
URBAN STAGE Komagome
URBAN STAGE Mukojima
URBAN STAGE Kasai East
URBAN STAGE Ekoda
URBAN STAGE Takinokawa
URBAN STAGE Itabashi Kuyakushomae
URBAN STAGE Asakusa
URBAN STAGE Machiya
URBAN STAGE Koganei
URBAN STAGE Musashi Koganei
URBAN STAGE Musashino Hills
URBAN STAGE Hino
URBAN STAGE Musashi Kosugi comodo
URBAN STAGE Kawasaki
URBAN STAGE Tsurumi Teraya
URBAN STAGE Urayasu

Location
Chuo-ku, Tokyo
Bunkyo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Nakano-ku, Tokyo
Suginami-ku, Tokyo
Toshima-ku, Tokyo
Sumida-ku, Tokyo
Edogawa-ku, Tokyo
Nerima-ku, Tokyo
Kita-ku, Tokyo
Itabashi-ku, Tokyo
Taito-ku, Tokyo
Arakawa-ku, Tokyo
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Hino-shi, Tokyo
Nakahara-shi, Kanagawa
Kawasaki-shi, Kanagawa
Yokohama-shi, Kanagawa
Urayasu-shi, Chiba

Acquisition Price
Percentage Leasable Floor
Leasable
Occupancy Rateof Total (%)
Area (sqm)
Units (units) (end of 9th FP)(%)(thousands of yen)
3,530,000
2.7
5,926.17124
90.4
647,000
0.5
662.582788.9
655,000
0.5
1,237.98
18
95.3
324,000
0.2
517.5332
96.9
635,000
0.5
1,053.3928
95.6
362,000
0.3
567.2034
100.0
900,000
0.7
1,739.8637
100.0
755,000
0.6
1,018.7247
93.7
730,000
0.5
1,774.01
27
100.0
539,000
0.4
810.981784.1
396,000
0.3
572.41
26
96.9
344,000
0.3
507.5228
100.0
738,000
0.6
1,384.45
29
100.0
1,150,000
0.9
1,773.05
54
81.9
530,000
0.4
722.7045
93.3
1,100,000
0.8
1,782.26
93
96.4
970,000
0.7
1,536.59
94
92.5
1,460,000
1.1
2,456.4895
75.8
472,000
0.4
801.3051
84.2
1,080,000
0.8
1,746.20
107
94.5
412,000
0.3
990.1819100.0
487,000
0.4
1,108.9155
92.8
940,000
0.7
2,324.9978
100.0
385,000
0.3
872.4935
94.2
287,000
0.2
554.392993.3
940,000
0.7
1,742.64
68
96.4
350,000
0.3
876.7022
94.7
210,000
0.2
455.1926
96.4
229,000
0.2
682.4327
93.3
2,390,000
1.8
5,999.80
98
99.0
1,590,000
1.2
2,961.06
80
96.8
319,000
0.2
994.6854
98.1
2,150,000
1.6
3,690.37
56
98.4
1,150,000
0.9
1,706.4680
96.6
457,000
0.3
952.0650
97.6
277,000
0.2
437.9427
92.6

38

Portfolio
#
109
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111
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113
114
115
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117
118
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120
121
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123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143

Name of Property
URBAN STAGE Minami Gyotoku I
URBAN STAGE Minami Gyotoku II
URBAN STAGE Minami Gyotoku III
URBAN STAGE Minami Gyotoku IV
URBAN STAGE Gyotoku Ekimae
URBAN STAGE Minami Gyotoku V
URBAN STAGE Gyotoku
URBAN STAGE Minami Urawa
Greater Tokyo Area
PROUD FLAT Itsutsubashi
PROUD FLAT Kawaramachi
PRIME URBAN Yamahana
PRIME URBAN Kita Juyo Jo
PRIME URBAN Odori Koen I
PRIME URBAN Odori Koen II
PRIME URBAN Kita Juichi Jo
PRIME URBAN Miyanosawa
PRIME URBAN Odori Higashi
PRIME URBAN Chiji Koukan
PRIME URBAN Maruyama
PRIME URBAN Kita Nijuyo Jo
PRIME URBAN Sapporo Idaimae
PRIME URBAN Nagamachi Icchome
PRIME URBAN Yaotome Chuo
PRIME URBAN Aoi
PRIME URBAN Kanayama
PRIME URBAN Tsurumai
PRIME URBAN Esaka I
PRIME URBAN Esaka II
PRIME URBAN Esaka III
URBAN STAGE Tsutsumidori Amamiya
Benefis Hakata Grand Suite
Benefis Yakuin Minami
Benefis Kashii Verbena
Benefis Hakata Higashi Grand Suite
Benefis Chihaya Grand Suite
Other Areas
Total

Location
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Saitama-shi, Saitama
Sendai-shi, Miyagi
Sendai-shi, Miyagi
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sendai-shi, Miyagi
Sendai-shi, Miyagi
Nagoya-shi, Aichi
Nagoya-shi, Aichi
Nagoya-shi, Aichi
Suita-shi, Osaka
Suita-shi, Osaka
Suita-shi, Osaka
Sendai-shi, Miyagi
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka

Acquisition Price
Percentage Leasable Floor
Leasable
Occupancy Rate
Area (sqm)of Total (%)
Units (units) (end of 9th FP)(%)(thousands of yen)
357,000
0.3
682.05
41
97.6
285,000
0.2
611.61
37
94.6
263,000
0.2
543.8433
100.0
256,000
0.2
535.0832
96.9
561,000
0.4
927.3346
95.7
293,000
0.2
662.6838
100.0
948,000
0.7
1,766.4777
100.0
274,000
0.2
694.0532
80.8
115,599,000
87.0
165,989.69
6,188
95.7
682,000
0.5
1,861.5660
100.0
724,000
0.5
1,967.5464
100.0
377,000
0.3
1,518.58
33
94.5
336,000
0.3
1,155.60
36
91.3
530,000
0.4
1,850.20
53
100.0
322,000
0.2
1,148.72
36
100.0
600,000
0.5
1,851.39
60
96.5
576,200
0.4
2,114.53
54
98.4
424,000
0.3
1,494.36
36
100.0
337,900
0.3
1,007.30
42
92.9
283,200
0.2
911.0727
96.3
503,700
0.4
1,773.90
36
97.3
731,600
0.6
2,439.90
58
95.8
1,110,000
0.8
3,411.2460
100.0
428,000
0.3
1,380.2143
100.0
724,000
0.5
1,571.04
46
92.3
632,000
0.5
1,391.02
58
96.6
1,189,096
0.9
2,502.11
104
96.2
672,000
0.5
1,189.1248
98.0
790,000
0.6
1,392.00
57
100.0
1,535,000
1.2
2,151.67
79
97.7
969,000
0.7
4,251.91
65
100.0
830,000
0.6
2,176.23
67
100.0
351,000
0.3
897.84
34
94.5
396,000
0.3
1,222.34
39
94.0
693,000
0.5
1,854.13
65
91.9
545,000
0.4
1,740.70
48
98.0
17,291,696
13.0
48,226.21
1,408
97.5
132,890,696
100.0
214,215.90
7,596
96.1

39

Fund Profile

Structure

History
July 28, 2006

Asset Custodian

General Administration(Financial Agent)

The FundGeneral Administration

Financial Agent
Agreement

Administration ofUnitholders Register
Management ofSpecial Accounts
Mitsubishi UFJ
Trust and Banking Corporation

The Bank ofTokyo-Mitsubishi UFJ, Ltd.

Asset Custody
Agreement

August 3, 2006
Registration of incorporation under Article 166 of theInvestment Trust Law. Incorporation of the Nomura Real
Estate Residential Fund, Inc.

Administration
Agreement, etc.

General Administration(Accounting, etc.)

Notification of incorporation by the founder (Nomura Real
Estate Asset Management Co., Ltd.) under Article 69 of theInvestment Trust Law.

Nomura Real Estate Residential Fund, Inc.
Accounting Service
Agreement

August 4, 2006
Applied for registration under Article 188 of the Investment
Trust Law.

Unitholders Meeting

Heiseikaikeisha Tax
Board of Directors Meeting
Financial Institutions, etc.

August 24, 2006
Registration approved by the Prime Minister of Japan under
Article 187 of the Investment Trust Law (Registration number
56, filed with the Director of the Kanto Local Finance Bureau).

AuditorErnst & Young ShinNihon LLC

Repaymentof Principal& Interest

Debt
Finance
Debt
Investment
Residential Properties(Real Estate Related Assets)
Property
Management
Property Management
Companies

Select the best property
management companies
for each property

CapitalInvestment

Asset

Trade

February 14, 2007
Listing on the Tokyo Stock Exchange.

Unitholders

EquityRent, etc.

Unitholders

Distribution
Property Management
Agreement

Instructions for
Rent &
Management
Rental Strategies,
Plans for
Repairs, etc.

Asset Management
Services Agreement
Information & ResearchService Providers

Asset Management Company
Property
Information

Nomura Real Estate
Development Co., Ltd.
Nomura Real Estate
Urban Net Co., Ltd.

40

Asset Management Company Overview

Corporate Data of NREAM

Structure

Shareholder’s Meeting

Name
Nomura Real Estate Asset Management Co., Ltd.

Auditors
Board of Directors

Date of Establishment
January 24, 2003

President & CEO

Capital¥300,000,000

Internal Audit
Compliance Committee
Compliance & Risk
Management Group

Shareholder
Nomura Real Estate Holdings, Inc. (100%)

Property Information
Meeting
Valuation
Committee

Investment
Committee

AcquisitionGroup

Investment
Committee

AssetManagement
Group

Fund
Management
Group

Financial& Control
Group

AcquisitionGroup

Description of Business
Asset management business for investment
corporations (J-REITs)

Private REITManagement Division

ResidenceManagement Division

OfficeManagement Division

Investment
Committee

AssetManagement
Group

Fund
Management
Group

Financial& ControlGroup

Investment
Management
Group

Representative
Atsushi Ogata, President & CEO (since Apr. 2010)

Registration & Licenses- Registered for a financial instruments business:
Director of Kanto Local Finance Bureau No. 374
Financial
PlanningGroup- Licensed for discretionary proxy in realty trading:
Minister of Land, Infrastructure and Transport No. 18
MarketingGroup- Licensed for real estate trading:Governor of Tokyo No. (2) 81679

41

This document has been prepared solely for the purpose of provision of information andshould not be construed as an offer, solicitation or commercial conduct of any natureassociated with any specific products. Investors wishing to purchase the investment unitsof Nomura Real Estate Residential Fund, Inc. should contact their own securities brokers
or dealers.
The forecast statements with respect to the future financial results contained in thisdocument should not be construed as a guarantee of the actual performance in the future.
Although the information contained in this document is intended to be complete andthorough, there is no assurance of precision and safety. Please note that the contents ofthis document is subject to change or cancellation without prior notice.
It is prohibited to make duplication, reproduction, distribution or use of any part or whole ofthe information contained in this document without express prior written consent.